While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking upgrades and downgrades -- just in case their reasoning behind the call makes sense.
What: Shares of Sprint Corporation (NYSE: S ) climbed as high as 4% today after Nomura Securities upgraded the telecom giant from neutral to buy.
So what: Along with the upgrade, analyst Adam Ilkowitz raised his price target to $10.50 (from $6), representing about 32% worth of upside to yesterday's close. While value investors might be turned off by Sprint's steady share-price climb in recent months, Ilkowitz believes that there's plenty of room to run given his forecast of strong EBITDA and free cash flow improvement.
Now what: Ilkowitz now expects Sprint to post per-share losses of $0.89 in 2013 and $0.40 in 2014, both up significantly from his prior estimates. "We believe operating cost reductions should be seen in two buckets: lower project spending (iDEN, Network Vision, roaming) and flat ongoing expenses," Nomura noted. "Our estimates are ahead of consensus, though they are more conservative than Sprint's publicly disclosed forecasts in the proxy filings." When you couple Sprint's still-worrisome trend of steep subscriber losses with its red-hot stock price, however, waiting for a wider margin of safety seems like the prudent move at this point.
Even More Premium Stock Picks
There’s a huge difference between a good stock, and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it’s one of those stocks that could make you rich. You can find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.
3 stocks so compelling, we've got $192,197 of our company's own money behind them...
According to The Wall Street Journal and the watchdogs at Hulbert Financial Digest, The Motley Fool boasts the TOP THREE performing investment newsletters in the entire world over the past five years -- handing our members an average annualized gain of 16.3% per year over that period.
In celebration, for a limited time, you can get the names and full details on three stocks (one from each of these award-winning services) that hedge fund veteran andMotley Fool Million Dollar Portfolio advisor Ron Gross is investing The Motley Fool's own money into right now -- plus claim a FREE bundle of valuable reports and other exciting gifts. Simply enter your email address below to take advantage.
According to The Wall Street Journal and the watchdogs at Hulbert Financial Digest, The Motley Fool boasts the TOP THREE performing investment newsletters in the entire world over the past five years -- handing our members an average annualized gain of 16.3% per year over that period.
In celebration, for a limited time, you can get the names and full details on three stocks (one from each of these award-winning services) that hedge fund veteran andMotley Fool Million Dollar Portfolio advisor Ron Gross is investing The Motley Fool's own money into right now -- plus claim a FREE bundle of valuable reports and other exciting gifts. Simply enter your email address below to take advantage.
No comments:
Post a Comment